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American Morning
Fed Trillion Dollar Investment Jump Starts Economy; Breaking Down the Bailout Bonus Tax Bill; Natasha Richardson Dies at 45; Young and Unemployed
Aired March 19, 2009 - 07:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
CHRISTINE ROMANS, CNN ANCHOR: Kiran, it's the top of the hour. Here are the big stories we'll be breaking down for you in the next 15 minutes.
Is it a good time to buy? This morning, mortgage rates are down after a bold move by the government to try to jumpstart the economy with a new trillion-dollar investment. This is a story people will be talking about today. We're breaking it down for you, telling you what it means for you, your house and your money.
The House is expected to vote on the bailout bonus tax today. The bill inspired by the AIG debacle is a kind of back doorway of getting the money back. It would allow Congress to tax executive bonuses at a rate of close to 100 percent if their companies took taxpayer bailout cash.
A family shocked and devastated this morning after the death of actress Natasha Richardson. She was just 45 years old. Richardson suffered a severe head injury after falling on a ski slope in Quebec on Monday, but the exact cause of death is still not known.
And breaking now, a new audiotape said to be from Osama bin Laden hitting the web this morning. CNN is working to confirm that it is the voice of the terror mastermind. In it, bin Laden calls for the overthrow of Somalia's president. That could be proof that bin Laden is still alive since he was only elected six weeks ago. Defense Secretary Robert Gates just commented on the hunt for the terror mastermind yesterday saying it's a lot harder than it looks.
(BEGIN VIDEO CLIP)
ROBERT GATES, U.S. SECRETARY OF DEFENSE: Too many people go to too many movies. Finding these guys is really hard, and especially if they have some kind of a support network.
(END VIDEO CLIP)
CHETRY: Gates also compared the hunt for bin Laden to the 17- year search for convicted Unabomber Ted Kaczynski.
KIRAN CHETRY, CNN ANCHOR: All right. Well all this week, "ROAD TO RESCUE." It's a CNN survival guide. We're taking aim at the economy and trying to arm you with the knowledge that you need to get through, you know, some tougher times than we've seen in quite awhile. Go ahead.
ROMANS: I was going to say in quite awhile. There are a lot of tips that we need and we're going to get the unmatched (ph) resources of CNN at your disposal.
Stephanie Elam, also personal finance editor Gerri Willis and the entire CNN money team up early to help you and your family. We're taking your phone calls, your iReports, your e-mails, real problems, real solutions. Call us at 877-MY-AMFIX. A lot of phone calls.
CHETRY: Yes. And we're also hearing from our viewers, as we said, weighing in on the AIG bonus scandal, your money and your taxes, and our callers are not holding back. Here's a little taste.
(BEGIN VIDEO CLIP)
KENDRA, CNN IREPORTER: I say take AIG executives, tar and feather them, and this is Kendra from Oklahoma.
CEDRIC LOCKETT (ph), CNN IREPORTER: This is Cedric Lockett (ph) from Aurora, Ohio. Let me tell you something. Any time that I have to go to work every day and pay my taxes, and then the government gives my money away, this is an outrage. A total outrage. We want that money back. We want it now!
KAY ZWAN, CNN IREPORTER: Please, stop this insanity of supporting and sponsoring corporate greed. We have been destroyed as a country.
(END VIDEO CLIP)
CHETRY: And there you see it, Christine. It's really just, as we talked about, it's not -- it really was a drop of water as you put it in this cup that just spilled over.
ROMANS: That's running it.
CHETRY: That everything that's been going on and the feeling that we don't necessarily have a handle on where this money is going or when it's going to stop.
ROMANS: It's the $165 million that put trillions of dollars in rescue all at risk, frankly.
CHETRY: Well, we have more people now pointing fingers at Congress as well as the president for letting AIG get away with this bonus outrage in the first place. Last night at a town hall meeting in California, President Obama responded to the anger saying that the buck stops with him.
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I know a lot of you are outraged about this. Rightfully so, I'm outraged, too. It's hard to understand that a company that's relying on extraordinary assistance from taxpayers to keep its doors open would be paying anybody lavish bonuses. It goes against our most basic sense of what's fair and what's right. It offends our values.
But these bonuses, outrageous as they are, are a symptom of a much larger problem. And that's the system and culture that made them possible, a culture where people made enormous sums of money taking irresponsible risks that have now put the entire economy at risk.
So we're going to do everything we can to deal with these specific bonuses, and I know Washington's all in a tizzy and everybody's pointing fingers at each other and saying it's their fault, the Democrats' fault, the Republican's fault. Listen, I'll take responsibility. I'm the president.
(END VIDEO CLIP)
CHETRY: Now, you heard from the president right now. We know how AIG got away because in the first place, you can blame the administration and you can blame Senator Chris Dodd. He's an influential senator when it comes to mortgages and your money. He is taking the hit because CNN's Dana Bash actually kept him honest, and she has some answers from Capitol Hill this morning.
DANA BASH, CNN SENIOR CONGRESSIONAL CORRESPONDENT: Kiran and Christine, it wasn't easy but we uncovered an intriguing case here in Washington of who done it.
(BEGIN VIDEOTAPE)
BASH (voice-over): All this outrage about AIG's bonuses from the White House...
OBAMA: People have a right to be angry. I'm angry.
BASH: ... to Capitol Hill.
REP. SPENCER BACHUS (R), ALABAMA: The country is angry. Individual Americans are angry. I am angry.
BASH: Yet Congress passed the bill last month that the president signed into law allowing AIG to keep its bonuses, and for days, no one would fess up about who was responsible for a mysterious loophole that let that happen. But CNN solved the mystery. It was the Obama Treasury Department and Senator Chris Dodd. Here's what happened.
Last month's massive stimulus bill included a Dodd measure to strictly limit executive bonuses, but slipped inside at the last minute an exemption for bonuses agreed to on or before February 11th, 2009. That allowed AIG to go ahead with its controversial bonuses. On Tuesday, Dodd adamantly denied to CNN that he was responsible for the exemption.
SEN. CHRISTOPHER DODD (D), CHAIRMAN, BANKING, HOUSING, AND URBAN AFFAIRS: When I left the Senate it was not in there. So when I wrote the language there was no such language like that. I can't point a finger at someone who offered the change at all. BASH: But the next day an official at the Treasury Department flatly contradicted Dodd telling CNN his office did know and that it was Obama treasury officials who pressed him to make the change, because they worried that his measure to limit executive bonuses in preexisting contracts, like AIG's, would face a legal challenge.
CNN took that information to Dodd, he reversed course and admitted he did make the change.
(on camera): You did agree to modify this, to put that clause in.
DODD: The alternative was losing in my view the entire section on executive excessive compensation. Given the choice, this is not an uncommon occurrence here. I agreed to a modification in the legislation reluctantly. I wasn't negotiating with myself here. I wasn't changing my own amendment. I was changing the amendment because others were insisting upon it.
BASH (voice-over): Dodd insisted he made the change at the behest of the administration, but admitted he was wrong in initially denying his role.
(on camera): You were very adamant yesterday, very adamant that you didn't know how this changed about in there. And now you are saying that your staff (ph) did work with the administration.
DODD: Well, going back -- going back and looking, obviously, I apologize.
(END VIDEOTAPE)
BASH: Senator Dodd says he is not trying to protect AIG. In fact, he insists that when this was negotiated a month and a half ago, no one believed we would "be sitting here talking about AIG and the bonuses" -- Kiran and Christine.
CHETRY: Good work. Good work, Dana, because she kept on it. And, you know, there were a bunch of different senators saying it mysteriously disappeared. We had this in there and now we're getting to the bottom of it, thanks to her. You know, and our political unit, really keeping on them.
ROMANS: And I think now we have a collision of Wall Street and Washington, the ugly ways that they work behind the scenes, both of them, and it's just -- that's why people are so upset. You know, we didn't expect it to be pretty.
A line of businessmen, students, protesters, stretched down the hall and around the corner in the Rayburn office building all to witness the verbal beating of AIG's top boss on Capitol Hill. Edward Liddy took that company over just six months ago after contracts that dictated the bonuses were already written, but the new face of AIG didn't get much sympathy.
(BEGIN VIDEO CLIP) UNIDENTIFIED MALE: Something is seriously out of whack and AIG needs to fix it now.
REP. GARY ACKERMAN (D), NEW YORK: There's a great company called, "I Can't Believe It's Not Butter." You know, at least they have the decency to tell you it's not butter.
UNIDENTIFIED MALE: As far as the American people are concerned, I think AIG now stands for arrogance, incompetence and greed.
REP. CAROLYN B. MALONEY (D), NEW YORK: AIG will be remembered as one of the worst financial disasters in American corporate history.
UNIDENTIFIED MALE: We have such abuse here, don't even think about coming up here looking for a bailout. That's a God damn disgrace.
(END VIDEO CLIP)
ROMANS: But Edward Liddy did get the chance to defend himself. Stephanie Elam is here with more on that.
I mean, he took this company over six months ago and had said that he feels it's his patriotic duty and he's serving his country by trying to help them.
(CROSSTALK)
STEPHANIE ELAM, CNN BUSINESS CORRESPONDENT: I was watching and I was in Rhode Island yesterday and between doing long shots, I would run back and watch some of the testimony.
ROMANS: It was good theater.
ELAM: It was very good theater.
CHETRY: They're poking at windmills.
ELAM: One was poking at windmills, although AIG was on the way more than our windmills. If you missed it, you can check it out online at CNN.com. But let's tell you a little bit about what's going on here.
You know, Edward Liddy has only been on the job since September but the AIG chief -- well, he knew he was in for a rough day.
(BEGIN VIDEOTAPE)
REP. PAUL E. KANJORSKI (D-PA), CHAIRMAN, SUBCOMMITTEE ON CAPITAL MARKETS, INSURANCE, AND GOVERNMENT SPONSORED ENTERPRISES: The truth, the whole truth, and nothing but the truth, so help you God.
EDWARD LIDDY, CHAIRMAN & CEO, AIG: I do.
ELAM (voice-over): Edward Liddy, the government-appointed chairman and CEO of ailing insurance giant AIG, began his testimony with the preemptive strike.
LIDDY: I've asked those who received retention payments in excess of $100,000 or more to return at least half of those payments.
UNIDENTIFIED MALE: Mr. Liddy...
ELAM: Despite that admission, members of the House committee unleashed their anger.
REP. MICHAEL E. CAPUANO (D), MASSACHUSETTS: So you could have fired these people.
KANJORSKI: Pay the $165 million back.
REP. JEB HENSARLING (R), TEXAS: With all due respect, Mr. Liddy, AIG has failed.
REP. PAUL W. HODES (D), NEW HAMPSHIRE: AIG now stands for arrogance, incompetence and greed.
ELAM: Four hundred eighteen AIG employees got bonuses, 73 of them more than $1 million. Liddy said some have offered to return them but Frank focused on those who didn't.
REP. BARNEY FRANK (D-MA), CHAIRMAN, HOUSE FINANCIAL COMMITTEE: I do ask that you submit those names without restriction and if you feel unable to do that then I will ask the committee to subpoena them.
ELAM: Liddy refused, citing safety concerns, reading excerpts of a letter aimed at AIG.
LIDDY: "All the executives and their families should be executed with piano wire around their necks."
ELAM: But first, he needed to protect himself from a few rhetorical bullets shot his way.
REP. STEPHEN LYNCH (D), MASSACHUSETTS: This is so outrageous that you would say we're not going to be victims of our own stupid decisions.
LIDDY: You have generously used the word "you" in that construct. As I mentioned, these contracts were all put together before I was at AIG, so I really do, I take offense, sir.
ELAM: Liddy said some bonus recipients had actually helped AIG cut its toxic assets, reducing its derivatives business more than a trillion dollars to $1.6 trillion.
LIDDY: The American taxpayer is better off because we have less risk, but we have to keep shrinking this business dramatically quickly so it doesn't get away from us.
(END VIDEOTAPE)
ELAM: Now Liddy told lawmakers AIG had a plan to pay taxpayers back the $170 billion within two to three years. By then, maybe we'll be better able to judge the decision to rescue the insurance giant. But needless to say, this is far from over and you did see a bit more feistiness coming from the CEO. But again, he's been put in this position. He wasn't there when the mess started but he did push back a bit yesterday.
CHETRY: Right. He also said, you know, it might not be AIG anymore after all of this is said and done.
ROMANS: Right. They got to stabilize the company. They have to sell it. They can sell. They got to wind it down where they can.
ELAM: Where they can, yes.
CHETRY: All right. Well, we wanted to make sure that you're involved all morning long as well. There are six ways for you to get your "AMFix."
You can call our hotline 877-MY-AMFIX. That's 877-692-6349, or you can check out our new blog, AMFix. When you get to work, go to CNN.com/AMFix. I'll tell you the four other ways in a couple of minutes.
Thirteen minutes after the hour.
The con artist accountant. What did Bernie Madoff's numbers man know about the biggest Wall Street scheme in history?
(BEGIN VIDEO CLIP)
ROSS INTELISANO, CLIENTS LOST MILLIONS WITH MADOFF: His family had $14 million invested in Madoff's securities and at the same time he was the auditor, which is an absolutely unbelievable conflict of interest.
(END VIDEO CLIP)
CHETRY: Serious new trouble for the rip-off king's right-hand man. How connected was he to the big fraud, ahead on the Most News in the Morning.
(COMMERCIAL BREAK)
ROMANS: All right. It's 15 minutes past the hour. Let's fast forward to stories that will be making news later today.
At 4:30 p.m. Eastern, president Obama will hold a town hall meeting in Los Angeles with the mayor. California Governor Arnold Schwarzenegger will also be there.
Then at 7:20 p.m. Eastern, the president will tape an interview with Jay Leno for "The Tonight Show" before returning to Washington.
This morning some people are saying he should either resign or be fired, but Treasury Secretary Timothy Geithner has the full support of President Obama. At 12:30 p.m. Eastern, CNN's Ali Velshi will sit down for an exclusive one-on-one interview with the treasury secretary and, indeed, there is a lot to talk about today.
A federal appeals court will hear arguments later today to decide whether Bernard Madoff will see a lot more daylight between now and his sentencing on June 16th. He's supposed to remain in a Manhattan jail until then when he faces up to 150 years behind bars. Madoff was the sole person charged in what is the largest investment scheme in U.S. history, that is until yesterday. Our Randi Kaye has more.
(BEGIN VIDEOTAPE)
RANDI KAYE, CNN CORRESPONDENT (voice-over): If Bernie Madoff was cooking the books to rip off investors, this man may have been helping him.
David Friehling was Madoff's accountant. He turned himself in on charges he rubber stamped audit statements from 1991 through 2008. He's out on bond but has not yet entered a plea.
JEFFREY TOOBIN, CNN SENIOR LEGAL ANALYST: This is prosecution 101. You try to get the accountant to flip and become the witness who explains everything about how the scheme worked.
KAYE: The 49-year-old accountant is the first person charged in connection with the $65 billion Ponzi scheme other than Madoff. His lawyer isn't commenting but he could get 105 years in prison. Prosecutors say Friehling was also an investor. It's unclear if he was aware of Madoff's Ponzi scheme.
ROSS INTELISANO, CLIENTS LOST MILLIONS WITH MADOFF: His family had $14 million invested in Madoff's securities and at the same time he was the auditor, which is an absolutely unbelievable conflict of interest.
KAYE: The acting U.S. attorney says Friehling "helped foster the illusion that Mr. Madoff legitimately invested his clients' money."
(on camera): Who else might prosecutors take down? They're looking closely at Madoff's sons who both worked for his firms. Prosecutors say they received loans from their father totaling more than $31 million. The last loan worth $4.3 million was made just two months before Madoff says he told his sons his business was a sham, which prompted them to call the FBI.
TOOBIN: The existence of these enormous loans from Bernie to the sons suggests that they may be more intertwined.
KAYE (voice-over): And Madoff's wife, Ruth, may not be in the clear. Prosecutors want to liquidate assets she owned or shared. Those include a $7 million yacht in France named "Bull," $2.6 million in jewelry, real estate around the world worth $22 million, even a $65,000 silverware set. Ruth Madoff may have a tough time convincing prosecutors her husband created the world's biggest Ponzi scheme, but her millions were collected honestly. Randi Kaye, CNN, New York.
(END VIDEOTAPE)
CHETRY: Well, the fed doing something major. It's throwing another trillion, that's 12 zeros, right at the heart of the problem. Well, it could make your home payments more sustainable, even more affordable. So are we mortgaging the future for that?
It's 19 minutes after the hour.
ROMANS: New details on the shocking death of actress Natasha Richardson. How could a simple fall end so tragically? A neurologist explains how what looks like a seemingly minor injury could kill someone, ahead on the Most News in the Morning.
(COMMERCIAL BREAK)
ROMANS: And welcome back to the Most News in the Morning. We're continuing our special coverage "ROAD TO RESCUE." Your phone calls are helping us to help you. Listen to this.
(BEGIN VIDEO CLIP)
GWEN, CNN IREPORTER: This is Gwen from Indiana. Let me tell you, the government needs to stand in and stop these banks from foreclosing on people. Why are the people being penalized for loss of jobs when that upper crust rich people have stolen so much from us and people are losing their homes?
(END VIDEO CLIP)
ROMANS: Some passionate calls. You can share your thoughts, too. Give us a call at 1-877-MY-AMFIX -- Kiran.
CHETRY: All right. Well, a major new move by the fed could help millions of struggling homeowners out there. The Federal Reserve is announcing its injecting $1 trillion into the economy, buying up treasury bonds as well as mortgage securities. It's good news for you. It's already pushing mortgage rates down this morning. So we want to show you a real example of how much this could save you.
Let's say that two years ago you got a 30-year fixed rate mortgage. They were at about seven percent and you were paying, this is on a $200,000 home, you were paying more than $1,300 a month.
Well, Zillow.com, a real estate tracker, says that rates now hit a record low on the news this morning, down now to 4.68 percent. That's a monthly savings of nearly $300. That's an example of how it could help you, so could this be the spark the housing market needs?
Well, Stephanie Elam and Gerri Willis are here now to talk more about this. And, you know, so it depends on where you're at, right? If you're looking to get into the market, is this a smart time to buy a home if you're currently not trying to sell an existing house? ELAM: Right and if you can also get, you know, go ahead and get that loan. Yes, this is a lovely time to go ahead and get into the market, to get some place that you're not trying to slip, just find a place that you're going to own and live in. This is a time that you would be good to look for it, obviously with rates going down they are really low anyway. So, what's up?
GERRI WILLIS, CNN PERSONAL FINANCE EDITOR: Prices are down 18 percent in major markets more than others, 30, 40 percent. It's a great time to be looking out there and the rates make such a big difference to people.
ELAM: They do.
WILLIS: They really bring down what you're paying each and every month for that house.
CHETRY: Right. So a couple of other quick questions. It depends on where you're at in your mortgage, right, whether you should think about refinancing? Because that also costs you money.
WILLIS: This opens the door, though. A lot of people will now -- this will now make sense for them for the first time in a long time to really try to get that new mortgage. Of course, if you are, you know, 15 years into that mortgage, you don't want to go out and get a 30-year fixed mortgage. You want to get a 15-year mortgage. You want to make sure that it makes sense that you're not loading on a lot of interest to your payments because a lot of people make that mistake. They go out, they get a longer term loan. They end up paying a lot more to the banks, so don't do that. These rates, though, are opportunities.
ELAM: Yes, but do the math first. Don't just necessarily think it's a good thing.
CHETRY: All right. Good advice from both of you.
This is one of our callers. This is Joe. He's calling from Fort Lauderdale, Florida, and he has a question about the mortgage plan. Let's listen.
(BEGIN VIDEO CLIP)
JOE, FORT LAUDERDALE, FL: My name is Joe, Fort Lauderdale, Florida, and I have a question.
Under the new Barack Obama home mortgage plan, I called Countrywide Mortgage and I am current on my loan. I currently have my job. I qualify for I think nine out of the ten criteria that the bank in Obama's plan has imposed but the bank is telling me that I am 116 percent loan-to-value and their cap is 105 percent loan-to-value.
(END VIDEO CLIP)
CHETRY: He's saying he's underwater, meaning he owes more than the home is worth by 116 percent. WILLIS: Right. You're right.
But he knows the details of this plan.
CHETRY: Yes.
WILLIS: He really gets it and 105 percent, it's just not Countrywide's rule, it's the president's rule and his new housing program. That's the way the plan works.
I can think of a couple of things that you might think about. First of all, the amount that you are underwater, I don't know how big your original mortgage is, maybe you find a way to pay that off. These interest rates are going to go so low here that it might be worthwhile to do that. The other option that I know a lot of people have pursued here, they stopped paying their mortgage so that they fall into that other category of people who are getting help and getting new loans. So, something to think about. I know a lot of people --
(CROSSTALK)
ELAM: And the other thing to keep in mind is that while they're trying to help as many homeowners as they can, they have pointed out they're not going to be able to help everyone with this. And so there are some people who are going to be left out.
CHETRY: One quick question, is there a chance that housing values will rise and take a hold off for --
(CROSSTALK)
WILLIS: Some day, yes.
ELAM: Yes. One day, yes.
CHETRY: Maybe we'll be in a different situation?
WILLIS: Six months? No.
ELAM: Yes, I don't think that quickly. Sorry.
CHETRY: OK. Thanks, guys.
Christine?
ROMANS: All right, Kiran. The family of actress Natasha Richardson left this morning with more questions than answers. The actress suddenly dies after falling on the slopes in Quebec. New details this morning about what happened in the minutes after she fell.
It's 27 minutes after the hour.
(COMMERCIAL BREAK)
CHETRY: Twenty-nine minutes past the hour. Here's a look at the stories we're following for you right now.
A trillion-dollar spark for the housing market. This morning mortgage rates are down after a bold move by the government to buy mortgage-backed securities.
And first AIG, now Fannie Mae planning to give million-dollar retention bonuses to four key executives. That's according to "The Associated Press" this morning. Fannie Mae along with Freddie Mac own or back more than half the mortgages in this country. The Fannie/Freddie bailout doubled to $400 billion last month.
And video of the morning, it's an underwater volcano erupting and then shooting smoke, steam and ash thousands of feet into the sky. This was just six miles off the coast of Tonga.
The locals said that the clouds started to rise after a series of sharp earthquakes. Officials say it's not that unusual in the area and people are not at risk, but boy, some amazing pictures captured on tape this morning, Christine.
ROMANS: Not like the explosion we saw yesterday on Capitol Hill, right? Getting the money back is now a familiar rallying cry, but is it even legal to get the money back? It's not just the AIG bonus fiasco. Many wonder if the victims of scam artist Bernie Madoff will get any of their money back.
Here to clarify for us is former New York City prosecutor Paul Callan. Thanks for joining us.
Let's start with this bonus debacle. Now we're talking about, you're hearing people say things like you know, let's not just honor the contracts or let's write a law so that we can get the money back and nullify the contracts. As a man of the law, what happens when you're not honoring contracts?
PAUL CALLAN, FMR. NEW YORK CITY PROSECUTOR: Well I can understand, Christine, why people are very angry about this. I mean, it's millions of dollars being given to people who lost enormous amounts of money and have crippled the country but the sacredness of the contract is so important in the American business system.
Think about it for a second. If you could void contracts after the fact, who would do business with AIG? Let's say you work for a company and the company has a problem and your boss comes in to you and says we're cutting your salary in half, going back in time and we want half the money back. I don't think many people would work for that company and that's the principle that we're looking at here.
ROMANS: We get a lot of e-mails and viewer voice mails who say things like you know, this is criminal, this is criminal. It's not criminal what's happening here is perfectly legal with this contracts, aren't they?
CALLAN: Yes. It's not criminal. It maybe disgraceful and it may be negligence particularly on the part of Congress when they enacted this legislation but it is not criminal, and I think that what Congress was looking at originally was they were nationalizing essentially AIG and they were saying how can we make sure it's a reliable company, we have to honor prior contracts.
ROMANS: Let's talk about Bernie Madoff. Because now he's behind bars, his former accountant has actually been arrested and released on bail. What happens here from a legal perspective from your perspective of trying to find out who else may have helped him. Do they follow the money?
CALLAN: Oh, they're going to follow the money big time. Because what happens now is the Justice Department has an asset forfeiture unit and they will swoop down now and they're going to try to find out was Madoff's accountant involved, does he have money proceeds from the fraud, does the wife have proceeds, do the sons have proceeds?
ROMANS: What about that money? The sons got loans from their father and their mother over the previous years. In fact, one loan, just a couple of months before he was arrested, is that money going to be scrutinized?
CALLAN: Oh, it's not only going to be scrutinized but I think there's a very good chance that that money is going to be seized by the government. Madoff, when he pled guilty said his fraud went back into the early 1990s. He lent his sons over $30 million during that time period. He used money to pay for the condo that his wife lives in.
ROMANS: I hope they didn't spend all of it. I mean because they're going to be looking at it, right. I mean, they could have to forfeit this money.
CALLAN: Well, they are going to be looking at it. But they do say that the Madoffs, the entire family still is worth hundreds of millions of dollars. So hopefully there will be some money recovered for the victims of this fraud.
ROMANS: Paul Callan, thank you so much. Kiran.
CALLAN: Nice to be here.
CHETRY: All right. Thanks so much, Christine.
Breaking news this morning, we're learning new details about the tragic death of actress Natasha Richardson. Here's what we know, on Monday, she was at a ski lesson on a beginner's slope in Quebec and she fell. She got up and said she felt fine. Then about an hour later at about 4:00 p.m. she complained of a headache, a severe headache. Again, that's when they called for an ambulance.
According to the Associated Press, the first ambulance that was sent to the ski resort earlier was turned away but then later after she did complain of that headache she was taken to a hospital and to intensive care. Then on Tuesday, she was flown to Lenox Hill Hospital here in New York. Yesterday her mother and sister arrived at the hospital and then the family issued a statement around 8:00 p.m. last night that she had passed away. Joining us now is Dr. Stefan Mayer. He is the director of the Neurocritical Care Unit at Columbia Medical Center. Thanks for being with us this morning.
DR. STEFAN MAYER, COLUMBIA UNIVERSITY MEDICAL CENTER: You're welcome.
CHETRY: First of all, there are a few details and the family didn't really release the exact cause of death. We're only trying to piece together what may have happened. By the way they're describing what happened, a fall that didn't seem too serious at the time and then about an hour later that severe headache. If you had to surmise what may have been going on what happened?
MAYER: Well, she probably had a concussion, and passed out temporarily, woke up, and felt fine, and she turned the ambulance away apparently. She felt OK. But that fall, that concussion, triggered something that was obviously going to end up being devastating.
Probably triggered some kind of bleeding in the skull between the brain and the surface of the brain. And that bleeding goes and it goes unchecked and builds up and then starts to press on the brain, and that can end up being fatal. That process is called either subdural hematoma or an epidural hematoma.
CHETRY: And so I think what's shocking is that she didn't appear at the time to be that hurt. A lot of people said she fell in the wet snow, got up right away and didn't seem hurt. What type of advice do you have for people who fall? We hear about people getting banged around all the time in sports and babies, you know, kids, what should you do out of an abundance of caution?
MAYER: Well, the main thing is, if you know what happens in, let's say a football game, somebody has a concussion, is to be checked out neurologically. And it doesn't take expertise. It's kind of common sense, so you ask the person questions. You know, where are you? You know, ask them to count a little bit, have them follow your finger with your eyes, and walk a straight line. But what you're doing is looking for any kind of sign of brain dysfunction.
If you see, if you encounter something that seems trivial and they're getting sleepy or they're confused, or they're weak on one side or can't speak properly, that should trigger terror because the brain is malfunctioning. And what you should do then is you call 911. You get to the nearest emergency room. And you need a CAT scan, because that's what's going to tell you very simple, easy to get, it's going to tell you is this really going to be OK or a major problem.
CHETRY: If Natasha Richardson had a CAT scan earlier, if she had gone immediately to the hospital, would she be alive today?
MAYER: There's no way to say that. You know, she might have been able to have gotten a CAT scan a little earlier but the reality is, Kiran, that sometimes these processes are just violent and destructive and despite doing everything you can, nothing's going to work.
But if there's one thing that I can say is that when it comes to brain injury, trauma, stroke, timing is everything. We have a saying, which is time equals brain. The earlier you can get to treatment, the earlier, the better chance we have to do something that can help you make a difference.
CHETRY: And hopefully it's a good lesson for everyone, but such a tragic situation for that family. Dr. Stefan Mayer, great to talk to you this morning. Thanks.
MAYER: Thanks a lot.
ROMANS: Kiran, real people, real problems, we're taking your calls, looking for solutions on the road to rescue. Join the coverage at 1-877-MY-AMFIX. We're going to share some of the best ahead.
Think it's tough finding a job? Try being in your 20s where the unemployment rate is over 15 percent.
(BEGIN VIDEO CLIP)
MARK STANIFORD, YOUNG AND UNEMPLOYED: They cut about 90 people and I was one of them.
(END VIDEO CLIP)
ROMANS: Special tips for the young and the jobless.
(BEGIN VIDEO CLIP)
TORRIE PAGOS, SOON TO BE UNEMPLOYED: I'm optimistic about it, but you know, that may be a little naive.
(END VIDEO CLIP)
ROMANS: Ahead on the Most News in the Morning.
(COMMERCIAL BREAK)
CHETRY: Welcome back to this special edition of AMERICAN MORNING "THE ROAD TO RESCUE."
We hear so much about struggling homeowners and the help that's on the way for them. There are other victims of the housing crisis who may be falling through the cracks. Take a listen.
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LISA W., BRONX, NEW YORK: My name is Lisa W and I'm calling from the Bronx in New York state.
And my issue that I have is that everyone's talking about homeowners. What about people who rent or people who own condos or co-ops that are having problems paying their rent and maintenance every month? (END VIDEO CLIP)
ROMANS: All right. Stephanie Elam and Gerri Willis back to take more of your financial phone calls. First call is about credit card charges.
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ROB, NEW YORK: This is Rob from New York.
I'm trying get rid of some vampire charges on my credit card. I do everything, point of service, like less than $500 worth of debt but somehow these bogus companies get a hold of your credit card. It's going to cost me 30 bucks to change my number and I don't see where I should have to do that.
(END VIDEO CLIP)
ELAM: First of all it's good he's keeping in control of his debt, only $500 that he has there. One thing he can definitely do is call the credit card company again and have them look into it and get a report on what's going where to find out what these charges actually are. That would be the first thing I would say that he should do.
WILLIS: There's a lack of clarity. And I'm wondering what he means by vampire charges. It sounds like somebody's stealing his credit card and using it. If that's the case, then you got a real problem on your hands. Then you have to go, get a new card and you're going to get all of this debt off of your credit report.
ELAM: It doesn't explain the $30 charge. So we need more information what that is.
ROMANS: This has happened to me a couple of times when someone who has stolen my number they called me and said don't worry your new card is in the mail, you don't have to pay for it, don't worry.
WILLIS: That's a good point actually because what you can do is call and say this is not my charge, you need to remove it. Maybe you've done that a couple of times and now the credit card company is saying enough is enough we're going to charge you $30 to change your number.
ELAM: And they will research it to find out exactly who is doing it. If they feel you're being fraudulent about it they'll look into it. A little bit more information that we need there.
WILLIS: I love the way he's using cash though. Cash is king always.
ROMANS: More phone calls too after the break. If you have money that you want to invest right now, god love you. You definitely want to stick around. We're going to tell you what to do with it.
It is 43 minutes after the hour.
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CHETRY: Welcome back to the Most News in the Morning.
It's 45 minutes past the hour now. We're continuing our special coverage "ROAD TO RESCUE." Stephanie Elam and Gerri Willis are back to take more of your financial phone calls and we have a question this morning about investing. So let's listen.
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SALLY, ORLANDO, FLORIDA: This is Sally from Orlando, Florida.
And the question that I have is, if you do have some money, for example, my son got some money for his birthday, where should I invest that?
(END VIDEO CLIP)
CHETRY: All right. Who wants to tackle this in.
ELAM: She's got some option. I'm assuming it's a young son that she has there. So she could easily get a savings bond, and put it away, a safe place for it to grow slowly, a nice safe investment.
Also, a 529 plan which is a good idea for paying for college. It's a good way to invest money, and put it away for college and then also, stocks are really cheap. If you want to get in there, could you do that and assume it's going to grow over the time of his life which most cases that's what would happen but she didn't really say what her risk level was. I wanted to give a bunch of options.
CHETRY: Talking about somebody who is maybe older like 20...
WILLIS: Back to the 529 plans for just a second because this is the big thing for kids who are growing up. You want to send them to college. How do you pay for it? 529 plans are a great way to go, savingforcollege.com, great website to check out and if you're going to do that. Just little advice here, don't use the broker's old plan. They can be more expensive. Buy them directly from the state. It's an easy way to go.
ELAM: And it's so easy to fund and you don't have to put a lot of money in there.
WILLIS: Right. If the child is older, I think you introduce them to investing. You buy them stocks and so they can get the experience of actually investing in the market and seeing what it does. It's a great learning experience and once you get involved, you get hooked and I think people really enjoy it and really...
ELAM: Really, so they'll respect it going in to college and not rack up a bunch of debt.
CHETRY: Exactly.
ELAM: Good luck with that. WILLIS: It works.
CHETRY: Thanks, guys -- Christine.
ROMANS: Respecting the value of the dollar and respecting money.
Bernie Madoff is in jail awaiting sentencing. But prosecutors now saying he didn't pull off the biggest rip-off in history all by himself. The man who allegedly wielded the rubber stamp now facing charges. We have the details.
It's 13 minutes to the top of the hour.
Think it's tough finding a job? Try being in your 20s when where the unemployment rate is over 15 percent.
(BEGIN VIDEO CLIP)
STANIFORD: They cut about 90 people, and I was one of them.
(END VIDEO CLIP)
ROMANS: Special tips for the young and the jobless.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: I'm optimistic about it, but you know that, may be a little naive.
(END VIDEO CLIP)
ROMANS: Ahead on the Most News in the Morning.
(END VIDEOTAPE)
(COMMERCIAL BREAK)
ROMANS: OK. Welcome back to our special "ROAD TO RESCUE" coverage here on AMERICAN MORNING. We're getting many iReports from folks struggling to find work. Check out this one from Kyle in Illinois.
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KYLE, CNN IREPORTER: I can't find a job. Searching for three months and cannot find one job anywhere, anywhere. And it's frustrating.
(END VIDEO CLIP)
ROMANS: Kyle, among the highest number of unemployed people in the country, nearly 3.7 million young people are now out of work.
Jason Carroll joins us now with that -- Jason.
JASON CARROLL, CNN NATIONAL CORRESPONDENT: Yes, just hearing from Kyle there from Illinois. I heard that story over and over while doing this particular story. You know, this is what the harsh reality is. Before the recession hit there simply were not enough jobs to go around. Now that we're in a recession, the younger the worker the more likely that worker could get pushed out of the job market.
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CARROLL (voice-over): Less than a week ago, Mark Staniford was busy at work as a market researcher. That was then.
STANIFORD: They cut about 90 people and I was one of them.
CARROLL: At 27 years old, he found himself jobless and with few options.
STANIFORD: With severance, I have about a month of that and I'm on unemployment after that.
CARROLL: Torrie Pagos may be joining him very soon.
PAGOS: I'd like to get a job but, I'm sure you're aware it's not easy.
CARROLL: The 23-year-old had just started a career in merchandising at Macy's. A career that may be stalled.
PAGOS: In February, the company laid off 7,000 employees and my job was eliminated. So I'm done probably the end of June.
CARROLL: Both are examples of who may be hardest hit during the economic downturn. The highest number of unemployed are the country's young workers. Nearly 3.7 million young people ages 16 through 29 are currently out of work. The February unemployment rate for the youngest workers is 15.5 percent, compared to the overall unemployment rate of 8.1 percent.
UNIDENTIFIED MALE: The job market is tougher than it has been in the past and probably tougher than the past 20 years, quite frankly, for college graduates right now. They do not have the experience that many workers have in the marketplace today.
CARROLL: Career experts say in some cases, older employees who have experience and who would normally retire during strong economic times are delaying retirement, leaving less openings for new workers.
UNIDENTIFIED MALE: Don't span the employment community. Make sure every single cover letter and resume is customized. Make sure you get involved.
CARROLL: Both Mark Staniford and Torrie Pagos are staying positive about finding a new job.
PAGOS: I'm optimistic about it but you know that may be a little naive. I haven't been jaded enough.
CARROLL: If it doesn't work out, both say they just might go back to school. Do you think maybe if you were to go to school, that might give you that sort of buffer period of time until the economy is...
STANIFORD: Yes, that's the hope.
(END VIDEOTAPE)
CARROLL: Well, the current jobless situation with young people can have dire complications for the country's future because those young men and women who stay unemployed for long periods of time lose valuable experience and training they would have gained by working. It then becomes very difficult to make up that ground later.
ROMANS: One thing that we do know is that the unemployment rate for people with a college education is much lower than the national average so I guess the advice is stay in school if you can and get the degree.
CARROLL: Right.
And you've heard from these folks, stay in school or maybe even go back to school.
ROMANS: Yes. Thanks, Jason. We're going to have a story later on about a young man who took his education and instead of being unemployed actually created a very successful business or what we hope will be a successful business. It is 54 minutes after the hour.
CHETRY: Sound off.
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UNIDENTIFIED FEMALE: I think those bonuses are total outrage.
(END VIDEO CLIP)
CHETRY: And get real answers. Nobody is more connected to you. On the blogs, on twitter, and taking your calls. The "ROAD TO RESCUE" starts right here.
Plus, forced out of retirement to drive a school bus.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: They save their money. They've had a plan in place. Yet, here they are.
(END VIDEO CLIP)
CHETRY: Why she still believes in the American dream.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: So what is your goal to rebuild?
(END VIDEO CLIP) CHETRY: You're watching the Most News in the Morning.
(COMMERCIAL BREAK)
CHETRY: Welcome back to the Most News in the Morning.
We're taking your phone calls all morning on the economy. Let's listen to this one.
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KATHY, FLORIDA: I'm calling from Florida and this is Kathy. My granddaughter is trying to work two jobs, part time and pay for a college loan. I feel very bad that they will bail out the banks and the government and all of the other automobile dealers and everything but they will not help the college loan kids.
(END VIDEO CLIP)
CHETRY: All right. We want to hear from you. Call us now or later in the day. 1-877-MY-AMFIX.
